The U.S. Education Department on Friday announced that it will retroactively waive interest on loans held by more than 47,000 current and former active-duty servicemembers who were overcharged on their federal student loans while serving in combat zones dating back to 2008.
That year, Congress eliminated interest on federal direct student loans for servicemembers deployed to areas subject to the threat of physical harm or imminent danger. However, few borrowers ever received the benefit, as servicemembers had to manually submit to the Education Department details about their military orders issued by the Department of Defense (DoD). Now, the Education Department will utilize data matching with the DoD to provide the interest waiver to servicemembers automatically, reported Inside Higher Ed.
"Brave men and women in uniform serving our country can now focus on doing their jobs and coming home safely, not filling out more paperwork to access their hard-earned benefits," said Richard Cordray, chief operating officer of the Education Department's Office of Federal Student Aid. "Federal Student Aid is grateful for our strong partnership with the Department of Defense, and we will seek to reduce red tape for service members wherever possible."
Related Links
U.S. Education Department Press Release
https://www.ed.gov/news/press-releases/us-department-education-grants-interest-rate-benefit-more-47000-service-members
Inside Higher Ed
https://www.insidehighered.com/quicktakes/2021/08/23/department-waives-loan-interest-service-members